Thursday, October 22, 2009

eBay net profit continues to slide

ONLINE auction giant eBay reported a slide in net profit for the fourth quarter in a row overnight but its earnings still came in slightly better than expected by Wall Street analysts.

eBay, which also owns online payments company PayPal and web communications firm Skype, said net profit declined 29 per cent to $US350 million ($376.6 million), or 38 cents per share, in the third quarter compared with a year ago.

Revenue rose six per cent to $US2.2 billion.

Analysts had been expecting US37 cents a share and revenue of $US2.1 billion.

"Our third quarter results were strong with PayPal gaining momentum and market share worldwide and our core eBay business showing positive trends," eBay president and chief executive John Donahoe said in a statement.

eBay shares fell 4.5 per cent in after-hours electronic trading to $US23.76.

eBay said revenue fell one per cent to $US1.4 billion at its core auction site eBay.com and other e-commerce sites.

It said international business accounted for 56 per cent of revenue from the sites.

PayPal saw revenue climb 15 per cent to $US688.1 million while revenue from Skype rose 29 per cent to $US185.2 million.

eBay said Skype added 40.3 million registered users during the quarter and now has more than 520.8 million registered users.

eBay announced in September that it is selling 65 per cent of Skype to a group of private equity investors.

The deal is expected to close in the fourth quarter.

The California-based eBay also said it expected revenue of $US2.2 billion to $US2.3 billion in the fourth quarter.



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